Beam puts punch in flat Coke result …

By Andrew Starke

Coca-Cola Amatil’s (CCA) alcoholic beverages business has continued to grow despite the soft drinks giant recording a fall in net profits for the first half of the 2011 financial year.

While CCA delivered a net profit after tax of $234.1 million, one-off costs associated with the closure of a factory in Victoria meant a net profit of $153.6 million, down 27.8 percent on the corresponding period.

Alcohol, Food and Services earnings grew 1.7 percent driven by a solid result from the Services division and the first time inclusion of revenue and earnings arising from the new agreement with Beam in April to sell spirits and RTDs as a principal rather than as an agent.

CCA also reported that it’s Pacific Beverages JV with SABMiller was on-track with the premium beer portfolio continuing to grow volume.

Peroni and Bluetongue were the stand-outs, performing ahead of market growth primarily as a result of the successful scale up of draught beer capacity at the new Bluetongue brewery in NSW.

Other innovations have helped drive increased demand in the on-premise channel.

“Whilst we would expect to generate stronger earnings growth in the second half of this year, the direction of current trading conditions in Australia remains uncertain as consumers deal with the continued increase in food, fuel, utility costs and interest rates as well as the uncertainty surrounding cost of living increases into the future,” said CCA’s group managing director, Terry Davis.

He added that CCA’s alcoholic beverages business would continue to enhance earnings growth.

“The successful rollout of locally produced draught beer and the recent extension of our relationship with Beam Global for a further ten years provides an additional earnings stream for the business that further leverages CCA’s capability and delivers on CCA’s goal to broaden its beverage portfolio,” said Davis.

Shares in CCA were trading at $11.09 at 3pm today (Aug 10), up from $10.52 on Moday.